The scam: An inquiry asking if you accept credit cards before discussing any project details. This will be followed by a request for work on a rushed timeline. The prospective customer will easily agree to terms and a budget. They'll offer to place a large deposit and then ask if they can transfer funds to you that are destined for a third party. Once you agree to the project, this new customer will want to pay you with a credit card very quickly. Once you transfer funds to the third party the original credit card payment will be charged back to you and all contact will be lost with the scammer.
Details of the scam
Here's a real world example received by real Wave customers:
"i have small scale business which i want to turn into large scale business now it located in XYZ and the company is based on ... so i need a best of the best layout design for it. Can you handle that for me ?. so i need you to check out this site but i need something more perfect than this if its possible .http://www._______.com.... the site would only be informational, so i need you to give me an estimate based on the site i gave you to check out, the estimate should include ...and i have a private project consultant, he has the text content and the logos for the site."
The customer often suggests a large deposit on the project, but insists on a rushed timeline. They do this because they'll be paying you with a stolen credit card, and want to complete the scam before the card is reported as stolen or the true owner of the credit card detects the unauthorized transaction.
They'll always involve a third party (such as a graphic designer, copywriter or consultant) who's meant to help with part of the project, but wants upfront payment before they can send something critical to you, such as a logo.
The prospective customer will claim they are ready to make payment with a credit card so that work can begin immediately. Then, they'll mention the third party, saying something similar to:
"...I will need a small favor from you for this to begin. I will send you my credit card to charge for the sum of $5000 plus any fees. You will then deduct $2,500 as a deposit for the design of the website plus an extra $200 as a bonus for helping me. Then, you will send the remaining $2300 to the graphic designer that has the logo for my website. ... You won't send the funds until after the money clears into your account, ...get back to me so we can proceed with the payment immediately."
The prospective client will provide a reason why the third party can't accept the payment directly. This could range from them not being set up to accept credit cards to them being tied up with a family emergency.
Once you process the credit card payment and receive the funds, the fraudsters will be asking you to quickly deliver the funds to the third party and get to work on the project. Unfortunately you will now likely be looking at a loss as the true holder of the credit card will dispute the charge and you will receive a chargeback.
Never experienced something like this before? Great! Be sure to keep an eye out and look for these telltale signs that you may be dealing with a fraudster.